Politis

Spain Announces Tax Cuts on Fuel and Broad Support Package Amidst Middle East Conflict

Published March 27, 2026, 07:25
Spain Announces Tax Cuts on Fuel and Broad Support Package Amidst Middle East Conflict

Spain has approved a €5 billion package of measures to mitigate the economic impact of the conflict in the Middle East. The measures include significant reductions in VAT on electricity, natural gas, and fuel, aiming to lower pump prices by up to €0.3 per liter. Additionally, the package strengthens the social electricity subsidy and prohibits layoffs in companies receiving state aid. The Sánchez government argues that the measures protect productive sectors and vulnerable citizens, while the opposition criticizes them as a broad tax cut. Most measures will be in effect until June 30th, with some social measures extended until 2026. This move follows an increase in gasoline prices in Spain due to geopolitical tensions.